In the race to stay competitive with bigger, better funded competitors, many small enterprises have felt compelled to follow along with any trends made popular by their larger counterparts, despite the fact that smaller companies tend to have fewer resources to allocate to these ad-hoc initiatives. Significant examples have been Lean, then Six-Sigma. Now, Agile is the buzzword initiative consuming the most headspace among American business leaders. But what of it? How should smaller enterprises think about Agile? My opinion on the matter might just surprise you.
Having worked with enterprises ranging in size from less than $50M to more than $20B, I’ve had a tour of the waterfront of American enterprise. It’s important to recognize at the outset that nearly all large organizations that undertake initiatives such as those named above do so because they are seeking to fix something that they perceive as broken in their business. They are searching – often at the direction of their investors – for greater efficiencies, a reduction in bloat, improved throughput, or some other accretion to earnings. These organizations, by their nature, tend to be less flexible, less nimble and less efficient than their small and medium enterprise cousins. And they are rarely successful in employing fads to chase earnings.
An Industry Week study of Lean implementations found that while 70% of all US plants had implemented Lean, just 2% had achieved their stated objectives. Put another way, 98% – nearly all – failed to produce the desired results of their Lean implementation. Turning to Six-Sigma, a study printed in the Wall Street Journal reported that fully 60% of all Six-Sigma initiatives were failures. Now, on the heels of these endorsements, comes the news from a recent study from IDC research, commissioned by ServiceNow, that 72% of CEOs see Agility as critical to driving business performance and growth. My advice to small business CEOs, however, is to sit this one out.
To be fair, Agile in its strictest sense refers more to a methodology for software development than for business operations improvement. However, more recently, the movement has begun to be co-opted by many general business consultants, seeking to apply its principles to everything from agricultural tractor R&D, to fighter jet manufacturing to wine & spirits warehousing. But for small businesses seeking to achieve, then maintain, an edge on those bound to follow the herd down the Agility path, there’s a far more effective alternative.
Simply ask those closest to the work and closest to the customer what you need to do to be better, faster, cheaper and more attractive to your customers. I promise you that they already have the answers. In many cases, they are dying to tell you. The most important actions for you to undertake in the process are to:
- Create a safe environment for input with ZERO recrimination allowed
- Actively listen
- Act on feedback received
- Recognize and celebrate wins
The people who perform the work in your business each day, and who speak the most to your customers, are the most aware of what works best and what could be even better. By asking them, you are not only opening the door to a wealth of free information that will dramatically improve your business, but you will be printing trust notes by the handfuls. And when trust goes up in a business, everything goes right along with it.
So, as attractive as the Agile bandwagon may seem, let it roll by for now. Spend some time with your people instead. If you need further convincing: in the same IDC study, among the 72% of organizations whose CEOs were raving fans of Agile, just one in five are agile-ready. And while that may seem like a selling opportunity for the Agility consultants, I’d say it’s more an opportunity for smart CEOs to head down to the floor and start asking for ideas.